Brazil Petrobras to restart sales process for Parana refinery

Author: Al Greenwood

2021/02/08

HOUSTON (ICIS)--Petrobras plans to restart the sales process for its refinery in the southern state of Parana after the bids it received fell below its threshold, the Brazilian state energy producer said on Monday.

Petrobras did not say when it would restart a new bidding process for the refinery, known as the Presidente Getulio Vargas Refinery (REPAR).

Earlier in September 2020, Petrobras said that REPAR's binding stage attracted the participation of Ultrapar, a consortium led by Raizen and China Petroleum & Chemical Corp (Sinopec).

Since then, Ultrapar said it was in talks to buy another refinery in southern Brazil in the state of Rio Grande do Sul. That refinery is known as the Alberto Pasqualini Refinery (REFAP).

Ultrapar is a Brazilian conglomerate that owns the fuel distributor Ipiranga. It did not immediately respond to a request for comment.

Sinopec did not immediately respond to a request for comment.

Raizen is a joint venture made up of Shell and the Brazilian ethanol producer Cosan.

In a statement, Raizen said it constantly reviews business opportunities with a focus on capital discipline and value creation.

MUBADALA MAKES BEST OFFER FOR BAHIA REFINERY
Meanwhile, Petrobras said that Mubadala Capital made the best final offer for its refinery in the northern state of Bahia.

Mubadala's offer is worth $1.65bn and it is for the Landulpho Alves Refinery (RLAM).

The sale is still pending approval from corporate bodies. Petrobras did not say when the deal could close.

Mubadala did not immediately respond to a request for comment.

If the sales goes through, it would make RLAM the first major refinery to be owned by a non-state player.

Petrobras owns all of Brazil's large refineries, with just a few small ones owned by non-state companies. Those include Univen, Dax Oil, Refinaria de Petroleo Riograndense and Refinaria de Petroleos de Manguinhos, according to a 2018 presentation by the National Petroleum Agency (ANP).

UPDATE ON SALES PROCESS
Petrobras is in the process of selling some of its other refineries.

The following shows refineries that Petrobras wants to sell. The capacity reflects crude distillation output as of 2019.

Refinery Location Capacity (bbl/day)
LUBNOR (Lubrificantes e Derivados do Nordeste) Fortaleza, Ceara 8,000
REFAP (Alberto Pasqualini) Canoas, Rio Grande do Sul 201,000
REGAP (Gabriel Passos) Betim, Minas Gerais 157,000
REMAN (Isaac Sabba) Manaus, Amazonas 46,000
REPAR (Presidente Getulio Vargas) Araucaria, Parana 208,000
RLAM (Landulpho Alves) Mataripe, Bahia 279,000
RNEST (Abreu e Lima) Ipojuca, Pernambuco 88,000

Source: Petrobras

LUBNOR's capacity includes 2,000 bbl/day of naphthenic base oils.

Petrobras still aims to sign purchase and sales agreements for REFAP, REMAN, RNEST, REGAP and LUBNOR as well as the Shale Industrialisation Unit (SIX) in Parana. SIX converts the kerogen found in shale into oil through pyrolysis.

Petrobras will keep the following refineries. Capacity figures reflect 2019 levels.

Refinery Location Capacity (bbl/day)
RECAP (Capuava) Capuava, Sao Paulo 57,000
REDUC (Duque de Caxias) Duque de Caxia, Rio de Janeiro 239,000
REPLAN (Paulinia) Paulinia, Sao Paulo 434,000
REVAP (Henrique Lage) Sao Jose dos Campos, Sao Paulo 252,000
RPBC (Presidente Bernardes) Cubatao, Sao Paulo 170,000
RPCC (Potiguar Clara Camarao) Guamare, Rio Grande do Norte 38,000

Source: Petrobras

Refineries produce naphtha, which many of Brazil's crackers use to make ethylene. Refineries also produce aromatics and propylene.

Thumbnail image shows Petrobras headquarters.